Can Facebook fail?

Okay, I admit it. I was wrong. Wrong about Facebook, even wrong about Mark Zuckerberg.

For the last couple of years, I've been imagining Facebook as the next dotcom Titanic, the classically over-hyped Silicon Valley start-up, all youthful bluster, but neither a business model nor any meaningful revenue. With its Twitter obsession and endless rumors of anarchy at its Palo Alto offices (not to mention Ben Mezrich's less than stellar semi-fictional book about Facebook's founding), I've always assumed that Facebook would fail in some meltdown of historic proportion.

But, in a blog post today, Mark Zuckerberg began with some stunning news:

"As of today, Facebook now serves 300 million people across the world. It's a large number, but the way we think about this is that we're just getting started on our goal of connecting everyone."

Just started on connecting everyone? Wow. You've got to admire the boy's chutzpah. He's got 300 million users – with 50 million added in the last 75 days, and now he's focused on "connecting everyone" (all eight billion of us? – thus giving a nice synergy to Facebook's $8 billion valuation). You can't argue with 300 million users. Facebook is now too large to fail. At worst, it will turn into AOL. At best, it will become a legal monopolist like Google.

But Zuckerberg followed up with even bigger news. Facebook is now profitable:

We're also succeeding at building Facebook in a sustainable way. Earlier this year, we said we expected to be cash flow positive sometime in 2010, and I'm pleased to share that we achieved this milestone last quarter. This is important to us because it sets Facebook up to be a strong independent service for the long term.

Facebook, therefore, is not the next big thing; it is the current big thing.

So Facebook is not only the King Kong of the social media business, but it's also "cash flow positive". What this guarantees, I suspect, is a Facebook IPO in the next year. Could this be Netscape 2.0? Will a Facebook IPO ignite the public market for technology again?

The Netscape parable, however, might be a word of warning for Zuckerberg. Back in August 1995, the Netscape web browser ruled the world in the same way as Facebook is dominating the social media space. But Netscape got acquired by AOL, the kiss of death for any technology company and a 90% market share in the mid nineties eventually collapsed to a pitiful 1%.

Is it possible, then, that Facebook could still screw up? Is it the AOL or the Google of social media?